10 Million Yuan Giveaway: China Puts Its Digital Currency to Biggest Public Test Yet
China might stop using cash soon, as it has reportedly given digital currency a shot at its biggest trial last week.
The government ran a lottery in Shenzhen, distributing a 10 million yuan (around $1.5 million) worth digital currency. Out of approximately 2 million people, 50,000 were lucky to get a slice of the cake.
The winners will be able to use their digital currencies over 3,000 different merchants but this won't cover the whole country. They will get to spend it in only a specific district in Shenzhen.
Among 3,000 merchants, there appear big names such as Walmart. Others are local supermarkets and pharmacies, where you can afford basic needs.
Also known as Central Bank Digital Currencies, they are quite a controversial topic among world countries. Apparently, not every country considers it necessary to issue yet.
Back in July 2018, the Finance Ministry of Germany had declared CBDCs sort of unclear, stating that a number of risks they pose were not well understood.
Among the rejectors, Germany is followed by Switzerland, Estonia, Japan, and a few other countries.
The common concern is that digital currencies don't seem to have proved trustworthy in an ongoing world economy. Another insight into the issue is that rejectors already have functioning payment infrastructures such as cryptocurrencies, which leave digital currencies out useless.
“Something similar has to happen with Bitcoin. People will only switch to something new if it works better or is cheaper,” Thomas Moser, board director of the Swiss National Bank stated in 2018.
As well as the ones who oppose CBDCs, there are also adopters, such as Senegal, Tunisia, and Venezuela. For instance, Tunisia has been using its blockchain-based national currency, which is called eDinar since 2015.
Uruguay, Dubai, Iran, and Singapore are the countries that are not one hundred percent sure about whether to use digital currencies or not yet, as they can be classified as experimenters.